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This fund is geared towards assisting Small, Medium and Micro Enterprises (SMMEs) and Co-operatives to purchase assets required in order to operate and generate profit.

Products offered under this fund include:

  • Asset Acquisition Finance
    • Instalment Sale Agreement (ISA):
      • An Instalment Sale Agreement (ISA) is a transaction where goods are purchased on credit, and the right of ownership is obtained upon payment of a series of predetermined instalments over a predetermined period.
      • This product is offered to clients, juristic and non-juristic entities, who wish to acquire assets for their business use and require the ownership of such assets at the end of the finance term. The instalment sale agreement will provide that the ownership of the underlying asset is reserved in the name of the client until the full outstanding amount is repaid.
      • The agreements may be regulated or non-regulated by the NCA depending on the legal status of the client and the size of the transaction.
    • Marine Finance:
      • Asset Based Credit Facilities (Term Loan), offered to clients (juristic and non-juristic entities) for the purchase of commercial boats registered within South Africa.
    • Aircraft Finance
      • The financing of aircraft (Term Loan) is highly specialised and additional information, over and above the normal credit requirements, with regard to the aircraft that is being financed, is required.
      • Asset Based Credit Facilities, offered to juristic and non-juristic entities for the purchase of light- passenger and – commercial aircraft – Only Special Aviation term loan agreement, supported by an Aviation bond will be considered. No ISA, Lease or Rental products will be considered for Aircraft finance.
    • Credit Lines
    • Whilst a credit line is not regarded as a specific product, there are guidelines when considering such facility types.
      • The financial position and proven cash flow of the client is the prime consideration rather than the underlying asset;
      • The client must have a need for such facilities i.e. the frequent replacement of assets that support the business;
      • The client’s capital budget and or replacement program must reflect the need for a Credit Line;
      • Once-off expansions should not be catered for within a credit line;
      • Credit lines as a marketing tool must be limited to clients with a strong capital base;
      • Due to unique risks per transaction, no buy/sell, private sales, specialised assets, interim contracts as well as imported assets should form part of Credit Line facilities;
      • Assets to be purchased must be clearly defined in terms of type:
        • Yellow Goods, Trucks, Trailers, Computer Hardware etc. and possible limitations per asset type;
        • New or used with an age limitation to used assets;
        • Maximum term of finance per asset type and age;
        • Deposit per asset type.
      • Suppliers should be limited to CAF preferred and approved suppliers.
      • The treatment of Vat is to be specified i.e. paid up-front, repaid over the first six (6) months of the contract etc.
    • Working Capital Finance Term Loan
      • A term loan is a once-off core-lending product, for low to medium risk customers, offering a loan facility for a specific term, with a specified payment and with a structured repayment schedule.
      • Negotiable repayment terms vary from 1 to 60 months depending on the purpose of the loan. The term of the loan must be aligned to the purpose of said loan.
      • Any business setup costs and operating costs that are required by the customer for business purposes must preferably be made available on a term loan basis.
    • Working Capital Finance Revolving Loan
    • This loan has all the characteristics of a Working Capital Term Loan however this is made available to the client on a continuous basis as a revolving facility.
      • Revolving Facility is reviewed in line with term financed to confirm affordability

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Ithala is an Authorised Financial Services and Credit Provider
FSP License No. 17139 NCRCP No. 1559 Reg No. 2001/007427/30
Ithala SOC Limited is a wholly-owned subsidiary of Ithala Development Finance Corporation Limited